Chapter 1040 – Too expansive
Feng Yu asked Kada Masao to visit that cara company to buy their digital cara technologies. Oh, this cara company is Kodak!
Kada Masao promised Feng Yu that he will buy the technologies at the lowest price as soon as possible.
Feng Yu has asked Kada Masao and not Ralph is because Kada Masao is Japanese, and he will be representing a Japanese company to buy the technologies. Japan’s digital cara technologies are the most advanced in the world, and Kada Masao can use this excuse to bargain and not let Kodak get suspicious.
Kodak had not placed much focus on the digital cara as they are afraid the rise of digital caras will affect their core business of film developnt. This is also why Kodak had been suppressing the developnt of the digital cara industry’s developnt.
Although Kodak’s digital imaging technologies are one of the most advanced in the world, their digital imaging related profit is only slightly more than 15%. Their investnt in digital imaging technologies and traditional film technologies are almost the sa!
Many shareholders are unhappy with Kodak’s CEO and felt his decision to develop digital caras had lowered the company’s profit. If the company concentrates on traditional film companies, their profits will increase by another 30%!
Kodak’s shareholders welco Kada Masao’s visit, and many shareholders felt the company should sell all their digital imaging-related patents and businesses as selling only the patents will let people think that Kodak is facing cash flow issues.
But so shareholders felt selling the patent technologies is enough. After all, their developers can continue to develop new technologies for sales or authorization. This will be another source of inco for the company.
After selling these technologies, Kodak will be making money from their digital operations. Since this division can make money, we should continue in this direction. If the company can develop more advanced technologies, their company will not lose out to their competitors.
A few shareholders opposed to the sales of their technologies and patents. The company had invested many resources and had just set its strategy to focus on both digital and traditional cara technologies. They need at least three years to see the result.
Digital cara technology has been improving rapidly in the past few years. In a few more years, digital caras will be good enough to challenge traditional caras.
But all shareholders felt digital caras will not replace traditional film caras anyti soon!
Kada Masao asked Feng Yu if Kodak is selling their digital image operations, should he accept it? The cost of acquiring Kodak’s digital image will be higher than buying their patents.
Kodak owns the most digital cara technology patents. This is a company with more than 100 years of history, and its brand is worth an astronomical value.
Without the Kodak brand, the digital cara business value will be lower. Simply put it. If a cara is printed with a Kodak logo, it will be worth at least 200 USD more than the sa cara with an unknown brand! Kodak’s brand can add value to a cara.
This is also the reason why Kodak’s digital caras are not selling well. Samsung, Sony, Nikon are also big brands, but they are selling their products at lower prices.
Furthermore, other companies had been promoting their digital caras, and only Kodak is still promoting their traditional caras. This is because they have film processing shops all over the world, and this is the company’s main revenue source.
Kodak film sales are also the world’s number one.
Feng Yu thought for a while. It’s not a bad idea to acquire Kodak’s digital imaging business, but it will depend on the price. If the price is low, he will acquire it to develop his own caras. At least he will not suffer any losses with the Chinese market.
If it is expensive, then forget it. It is not worth competing with overseas brands as a digital cara will only last for about ten years. Ten years later, the smartphone will be the trend, and there will be all sorts of photography APPs that are more fun than digital caras.
Only professional and enthusiastic photographers will continue to use digital caras. But how many professional and enthusiastic photographers can there be?
If digital caras can be developed into digital video caras, the prospect will be better. But digital video cara technologies are different from the digital cara, and Kodak does not have it.
Traditional video caras will be obsolete in 6 to 7 years, and movies will be fild using digital video caras. Digital video caras are lighter, have higher storage, can be edited using software, and is much cheaper than using films.
Digital videos only require so storage space, and this can save lots of production costs. The small size camcorders will beco very popular with people to record their own videos for leisure.
The digital cara’s trend is also because of the developnt of PCs. Many people like to take pictures but are unwilling to spend money to develop films.
But with digital photos, people can delete the pictures they don’t like and print only a few better pictures.
But when Kada Masao told Feng Yu about Kodak’s asking price, Feng Yu is dumbstruck.
“What did you say?! They are asking 4.6 billion USD for their digital cara business?!”
This amount had exceeded Feng Yu’s budget by more than ten tis!
Feng Yu’s budget is 500 million USD for advanced digital imaging and cara technologies and patents. If possible, he will only buy the technologies and patents he needs.
“Boss, their technologies are very advance and owns many exclusive patents. I am confident that we can buy out their digital imaging business within 4 billion USD.”
Kada Masao knew Feng Yu can afford 4 billion USD, and Feng Yu had been willing to spend on the industries he targeted.
“No! It is too expensive! You just pick so imaging and electronics technologies will do. As for the rest of their technologies, we can just buy the authorization or develop ourselves.”
Feng Yu only wants to integrate digital caras into his mobile phone. 4 billion USD is a huge investnt, and Feng Yu still need funds to acquire AMD’s shares.
Kada Masao realized he had misunderstood Feng Yu, and quickly say. “Boss, don’t worry. If we are only buying a few technologies and patents, or getting the authorization, it will not even cost 500 million USD. I can even get them to sign an agreent to let us have the priority to buy any new technologies they developed in the future.”
“Ok. Just go and negotiate with them based on what you said. Try your best to lower the prices.”
After hanging up, Feng Yu shook his head. Even as a super tycoon, he still does not have enough to spend!
Kodak
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